The goal is to determine the molecular and genetic mechanisms controlling a developmental "switch" in a simple animal model. The approach utilizes the advantages that the nematode C. elegans offers for molecular genetic studies. The switch is manifested at the second larval molt when alternate developmental fates may be expressed (either formation of a growing third-stage larva, or formation of a developmentally arrested, non-feeding dauer larva) based on environmental conditions. Starvation and overcrowding during the first larval stage induces formation of dauer larvae, which may survive for months, and when they find conditions favorable for growth, they resume development. The developmental decisions governing entry into, or exit from, the dauer stage are made in response to the ratio of food to the C. elegans dauer-inducing pheromone. Mutants affected in the decision to form dauer larvae are either dauer- constitutive, which form dauer larvae in abundant food, or dauer- defective, which cannot form dauer larvae when starved. Interactions between specific mutants have been used to construct pathways for gene action, now including more than 20 genes. Three genes have been cloned by transposon-tagging, and they encode molecules. Intermediate steps in the pathway are mediated by the daf-1 and daf-4 genes, which encode transmembrane receptor serine kinases. The daf-1 receptor was the first receptor serine kinase reported, and mammalian activin and TGF-beta receptors subsequently were found to be related to it. Activin and TGF- beta are growth factors of profound importance in vertebrate development. If the signal transduction pathway that regulates the C. elegans dauer larva is the nematode analogue of a TGF-beta or activin signalling system, C. elegans genetics may provide the means to identify the missing links between signal generation and control of gene expression in these vertebrate systems. The daf-12 gene specifies what we believe to be the last step in signal transduction. It encodes a member of the steroid-thyroid hormone receptor superfamily. Whereas daf-1 and daf-4 are required for normal non-dauer development, daf-12 activity is required for dauer larva morphogenesis. We propose that the daf kinases phosphorylate proteins that promote growth, and directly or indirectly inactivate the daf-12 receptor, possibly by preventing synthesis of a dauer-inducing hormone. Specific goals fall into complementary areas aimed at (1) understanding the relationship between the dauer and activin/TGF-beta signalling system, (2) identifying the ligands for the daf-1 and daf-4 receptors, (3) identifying the downstream targets for phosphorylation, (4) understanding how mutational changes affect daf-1 and 4 structure and function, (5) determining whether the daf-12 receptor is a ligand- activated transcription factor, (6) identifying DNA target sites for daf- 12 action, (7) genetically identifying additional genes involved in the dauer pathway, including those which may have essential functions in development, and (8) characterizing daf gene homologs in a parasitic nematode.